Moody’s rates UFC loan Caa1

Moody's Investors Service said it assigned VGD Merger Sub, LLC's (UFC Holdings, LLC) proposed second-lien term loan a Caa1 rating.

The B2 corporate family rating and B1 rating for the proposed $150 million revolver and $1.3 billion first-lien term loan were both affirmed.

The outlook remains stable.

Proceeds will be used to help fund the acquisition of Zuffa, LLC (UFC Holdings, LLC will be the rated entity following the close of the transaction) by WME Entertainment Parent, LLC (WME Parent) in partnership with Silver Lake Partners and Kohlberg Kravis Roberts & Co.

The agency expects the transaction will be funded with $1.42 billion in new equity, $325 million in rollover equity from management and existing investors, $400 million of preferred equity, $1.3 billion in new first-lien term loans and $500 million of second-lien term loans.

The existing ratings at Zuffa, LLC, including the Ba3 corporate family rating and the Ba3 rated senior secured credit facility that is on review for downgrade, will be withdrawn upon repayment of the outstanding debt.

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